In conversation: Ubisoft’s Steve Miller and Julius Witz on the business in Asia

Away from the packed bustle of Taipei Game Show 2019, behind a registration desk decorated with a Ubisoft placard and beyond PCs loaded with Far Cry New Dawn, sat two members of the publisher’s business management team.

Steve Miller, managing director for Asia (left), and Julius Witz, general manager for Southeast Asia (right), were engaged in a small roundtable discussion with Singapore media on Ubisoft in this slice of the world. Cracking the SEA shell has been a tough endeavor for western companies, and the French independent company doesn’t see itself exempt from the list.

From pop-up events and distribution, to esports and games as a service, we poked the two for their thoughts on various topics. Grab a cup and get comfortable, for this will be quite the read.

Note: The following has been edited for length and clarity.

We’ve seen a few Ubisoft studios cropping up across Asia but will we see a physical store in the region?

Steve Miller: We probably have other priorities than a store. If we’re going to invest in Asia, we’d probably invest more in localization. There are a lot of languages that we don’t localize into yet, like Thai or Bahasa.

Investing more money in, for example, local customer support or local servers, or local SNS influencers, or trying to communicate more with our local users. Right now, we do very little in Philippines or Malaysia or Indonesia. We have the studio in Singapore so we have kind of a close connection with some our Singapore fans, but again there’s more we could be doing.

A store is not high on the priority unless… you think it would be successful? (Laughs) It’s hard to do merchandise because you can’t have just the store – you have to have the staff, the warehouse, the logistics, so it becomes quite expensive. Maybe an online store presence might be something: Shopee and Lazada are very active in the region so that might be something interesting to think about.

Based on all the expansions we’ve been seeing, will we see a similar trajectory for esports?

I hope so. Esports for us is also something we need to be investing more in Southeast Asia and other parts of Asia. We have a good Rainbow Six population in Japan so we do a lot of activities there. We have some events and we work closely with the teams that play it, and they’ve done well in semi-finals and finals around the world. So, yes, we would like to develop the Rainbow Six player base in other regions as well. It’s something we want to spend more time and money on.

Have there been any opportunities for you to do that in Asia?

There’s nothing I can announce right now. To tell you the truth, it’s something that we’re spending some time thinking and talking about this week at Taipei Game Show. Me and the boss of Southeast Asia, Julius, we’re thinking about the next concrete steps to take in Asia for esports. We have a really special product with Rainbow Six. Not every game is suited for esports, even competitive games, but Rainbow Six works very well so it’s an opportunity that we can’t let escape.

The Season 8 Finals of Rainbow Six Pro League at Rio de Janeiro, 18 Nov 2018. (Photo: Ubisoft)

You mentioned tapping into the local communities in Singapore, Malaysia, and so on. We’ve seen other studios overseas having weekly streams and such, so is that something you’re looking into for the region here?

It’s something we have to do. One of the big problems with Southeast Asia is that you’ve got three or four or five or six countries and languages and different population bases, different age rating regulations, what you can show on TV, what you can talk about, and how you broadcast. It’s not as efficient as Taiwan or Japan, so we have to look at where it makes financial sense, frankly — we’re a business, we’re not a charity.

It has to have a big playing base, it has to be interesting for Ubisoft’s long term, but yes becoming closer to our fans is part of Ubisoft’s worldwide… mission. It’s part of our worldwide philosophy. Social media and things like Twitch, getting direct feedback and responding to that feedback, is one of the best ways. It does cost money (laughs). We have to hire local emcees and people who can speak on camera, people who know the game, and people who can manage the SNS traffic, so it becomes complicated.

And there are different platforms.

The platforms are another thing too. PlayStation 4 works well in Japan, in Taiwan, but it doesn’t work well yet in some of the countries in Southeast Asia.

Speaking of finances, Ubisoft has seen annual growth in player returning investments such as DLCs and seasonal content.

Sure, it’s a worldwide trend, it’s not only for Ubisoft. I think other publishers are also seeing good results with player retention and every company is getting better at understanding what content players want to buy or what they feel motivated to spend on. For us in the Asia region, this digital content is becoming a bigger part of our business. So, yah, we need to get better at listening to our consumers and getting content that they want, and we have to always watch our competitors and look at what they’re doing, to borrow some ideas from them.

It’s something that’s always changing: what works well this year might not work well next year. A game like Fortnite comes along and changes the way players and companies think about video games, so that’s very interesting and exciting. But if we try to copy that and come out with something similar, the market may change (laughs). It’s always risky.

Based on the current portfolio of games, Ubisoft are moving towards more games as a service. Was that a conscious choice for the company?

For sure. Games are as expensive to make as movies, if not more, so putting a disc into a box and putting it on a shelf is not long-term – it’s not a great strategy any more. If we spend tens of millions or a hundred million dollars making a video game, we want that game to have a long lifetime. And the games themselves are long, it takes 20 or 30 hours if you want to play the game from start to finish, and all the side missions. A movie is passive, you watch if for two hours and then it’s done.

But we want you to become attached to the game and feel an emotional connection with the characters. After work or after school, to come home and spend some time with Ezio from Assassin’s Creed or Father Joseph from Far Cry. So the games have to become long-term and they have to become services, and so we have to… forever come up with new content for the games to keep the players interested. It is a conscious choice to move in that direction.

Again, it’s expensive because you need a live team to continue creating content and to continue servicing your online infrastructure. Not every company can make that commitment. It’s a clear direction for Ubisoft, and our players, hopefully, should expect more of it.

Player returning investments such as DLCs and season passes sees strong annual growth. (Image: Ubisoft)

I think you guys are pretty much on the right track.

I hope so! I look at us, particularly in Asia, and you know, Korean companies have been providing games as a service since the late 1990s and they’re very good at it. Chinese companies have been doing it, Vietnamese companies have been doing it, and in many ways they are more advanced than us. Ubisoft is a western company so our headquarters is located in Europe – we’re not as close to the Asian consumers as we should be, we don’t react as fast as we should. And the innovations that happen in Asia… Its’ easy for a company like Tencent or Netease to pick up on new trends, but it takes us a little while longer to pick up on it. In a sense, in Europe we’re the champion but in Asia we’re still the challenger, we’re still up and coming. For me its exciting because it means there’s always somebody to beat (laughs). “How do we beat “Nexon or “how do we beat Netease, how do we beat Tencent?” We can’t be lazy.

Have you thought of partnering up with someone in Asia?

Well we did make an announcement that we’re partnering with Tencent. I think a lot of people are interested: “What’s going on with the Tencent partnership? What does Ubisoft have planned for China?” For the rest of Asia… well, when it makes sense to partner with somebody. We have a bit of an independent spirit and our founder, our chairman, Yves Guillemot, he likes to learn and do things and try things by himself. But, yes, partnering in Asia is one way to reduce our risk and learn so, if it makes sense, we’ll do it.

Ubisoft is quite unique in that it has a ton of studios around the world. You have the lead studio in Montreal and the supporting ones in Kiev, China, and so on. What is the grand vision for Asia as whole?

The way Ubisoft is structured, you can think about it as two companies: there’s the side that makes the games, the studio side; and then there’s side that markets and sells the games, the business side. I’m on the business side so I’m not capable of answering for the studio, but I know that we’re always looking for studio talent.

Creating content is going to become more and more important, and creating content means you need to have programmers, graphic artists, people who create the music, the interfaces – so we could always use more talent. Asia’s interesting because it has a lot of good video game talent, so I imagine the studios will continue to expand its presence in Asia as it has been doing.

For the business side, I’m based in Japan so that’s my specialty. I know we’ve been growing in Japan; we intend to grow more in Southeast Asia as well. Globally, I think– my personal feeling is that our future is in Asia. It’s not a very risky prediction, it’s not a very bold prediction, it’s kind of obvious, but I think Asia will be a large part of Ubisoft’s future. So it’s super important that we know our Asian consumers better. And that means we got to be there, we have to have more offices there, we have to have more studios there, more closer interactions with our users. Maybe… you mentioned stores earlier – maybe it’s pop-up stores, or retail, or events.

Being in Japan, I’m sure you were elated to hear about esports going official.

Yes. The situation in Japan was that we could not offer cash prizes to the general public; we could only offer cash prizes to professional players, but there was no way to identify or appoint a professional player. Now, there’s a way where we can go, “OK this team is professional, this team is still amateur.” That problem has been fixed so now we can be more active in esports in Japan. I’m not sure about the legal issues in all the countries in Southeast Asia but I think Japan was unique.

The problem in Southeast Asia is not the legalities, it’s as I mentioned earlier: you have many markets, the player base is diffused among different languages and different… everything. Different standards, currencies, platforms. Where do we invest our time and money? Do we invest it in Indonesia right now or do we invest it in Singapore? It’s about trying to find the best strategy in Southeast Asia. It’s quite difficult for a western company but we’re figuring it out slowly.

It helps to have offices in Asia.

Yes. You need to have killer content, so for many countries in Asia Rainbow Six is killer content. But for some countries it might be Just Dance. You might not consider it as an esport title but it’s the kind of title that can be interesting. It’s non-violent, its good for families, its good for kids, it makes you active – so if we do an esports event in a shopping mall using Just Dance it can be very exciting.

And it’s the kind of thing that governments might support. Governments are interested in encouraging or developing esports but it’s difficult for them to invest in a game that is violent or political. So Just Dance is something we might be able to get governments interested in.

A Just Dance thing in Singapore? That would be awesome – put it in Marina Bay or somewhere. Why not?

Probably the last question: You mentioned Southeast Asia being a complicated network. So in terms of distribution have you explored partnering with others like, say, Lazada?

Yes, its something we always look at and its something we need to go back to. Because again – I’m not sure, maybe two years ago — Lazada was not even big in Southeast Asia and Shopee was relatively new also, I think. So next year maybe there’ll be a new way of delivering games to consumers. Maybe there’ll be a killer app that everybody will have that they want to use to get Ubisoft’s content.

So its something that we look at all the time. It’s something that has inhibited the growth of Ubisoft in Asia and I think other companies too. How do you reach these tens of millions or hundred million consumers in Southeast Asia? We have been good at making physical boxes and putting them on the shelves, but this method doesn’t work for us in Southeast Asia so well. We have traditionally sold at a high price and physical distribution is complicated. What do you with the language on the boxes, is it okay to use English or do you want to use Bahasa?

All of these complicates things, but everybody now has access to the internet. A lot of people have access to downloading platforms, Steam and Epic, and any of a million other ways to purchase games. So, yes, looking at how the games go from the studio to your pocket, or your home, is something that we’re spending more time on.

Julius Witz: (Walks in) Hello.

Miller: You’re just in time, we have to wrap it up!

Witz: I hope he did a good job. Whatever he said is true and I 100% agree (laughter).

Ah, so you’re based in Hong Kong.

Witz: Yes, and I work for him and I try to take care of the Asian markets.

Miller: He goes around the region more than I do. Ubisoft retail in Southeast Asia, what do you think?

Witz: I would love to have a pop-up store, you know. If we can have an event for Rainbow Six or The Division 2, to have a chance to sell some merchandise or provide our fans with the collector’s edition. Something that’s limited to a dedicated event, but a permanent store? It just doesn’t work. It’s expensive and we saw– even the real monster companies in our industry tried it in the US and London and it didn’t work very well. I think it’s more fun to bring people together to an event, show them the game, and sell a limited-edition figurine.

The games lineup at Ubiday 2018 in Tokyo. (Image: Ubisoft)

Something like Ubidays.

Witz: Something like Ubidays! It’s a service for our fans. Permanent is impossible but for local events, for pop-up stores, these kinds of ideas. Sometimes it’s complicated but with a strong local partner it’s possible.

Miller: And regulations too, because a lot of our merchandise is designed in Europe and made in China. For example, when we bring it to Japan, if it’s anything electronic it needs to go through an electronics certification; if it’s something you can eat or like a mug, you have to test it for dangerous chemicals. You can’t just import a thousand mugs, you have to go through this complicated import process. If you have something for small children, we have to ensure that parts can’t be ripped off and accidentally swallowed. It does make a retail store difficult.

Witz: Japan is a very strict country. But when it comes to ecommerce there is a good chance. Finding the right distribution partner could be an option to offer fans the games or collector’s editions that they want. Singapore is easy, it’s not that big, you just need a guy with a car (laughs). And to be honest, I think we have a very, very strong local partner in Singapore because the company we work with, they know the market, and when we have a collector’s edition they really do lots of promotions in stores, they show it in different stores. It’s more complicated for Thailand, for Indonesia, for Malaysia, because they’re so big.

Going back to ecommerce, The Division 2 is now not on Steam, it’s on Epic’s games store. What do you guys think about that decision?

Witz: It’s mainly driven from a European-US perspective. For us in our region, we try to focus strongly on the Ubisoft Store. We’ve developed it a year ago, we invoice it in Singapore dollars, we have local stores with local pricing, so I hope for our fans it’s their first way to purchase a game.

Thanks for your time!

That Ubisoft Store they mentioned? You might want to check it out, for they’re currently running a Lunar New Year sale with considerable discounts on their catalogue. Head there even if you aren’t buying anything, anyway, as they’re also giving away Assassin’s Creed Chronicles — China and Splinter Cell Conviction for free.

In other related news, the private beta for The Division 2 has recently went live. Stay tuned for our impressions next week!

Disclosure: Ubisoft covered flight and accommodation to Taipei Game Show 2019.